MercoPress. South Atlantic News Agency

Enap joins British Gas to build electricity plant

Chile's government owned petroleum company ENAP teamed up with Chilean group Copec and British Gas for the building of an electricity generating plant with an estimated investment of 300 million US dollars.

The project is part of Enap's leading role in converting and diversifying Chile's energy sources which currently are highly dependent on Argentina's natural gas supply.

Enap is already involved with British Gas in building a gasification plant in north Chile which should be finished by 2008; it is exploring for natural gas in Magallanes Region, apparently with promising results, and has reached an understanding with a local group to develop bio-fuels from crops.

The electricity plant project is expected to work on liquid natural gas and steam with a capacity of 400 MW. Apparently the project is crucial to ensure energy to one of Enap main refineries.

The feasibility of the project should be ready by November 30, and 24/30 months later, mid 2009, the plant should be operational, which means Enap will be involved in another energy area, electricity. If the initiative is successful other projects are in the "pipeline", revealed Enap officials.

Copec is a Chilean group involved in forestry, fuel and fisheries with over 90 years in the business.

Enap has also joined Iansa a Chilean sugar mill to study the feasibility of developing bio-fuels such as ethanol and bio-diesel from crops and non conventional renewable sources. The project should also help depressed sectors of Chilean agriculture such as those involved in wheat, corn, sorghum and other cereals, which have difficulties competing with Argentina and Brazil in the framework of Mercosur.

The objective is to blend 5% bio-fuels with gasoline and diesel at the latest in 2010.

"We should have a joint venture working by early 2007", said Felipe Lyon, Iansa's CEO.

In the extreme south of Chile in the Magallanes Region Enap has been exploring for natural gas in the Lake Mercedes area with promising results which should be clearly defined by the end of 2006